Worse than They Already Are

As a contrarian and a cynic, my inclination is to fade "the crowd." But when it comes to the state of the economy, the American public has proved to be spot-on, at least in recent years. Under the circumstances, the fact that they have an altogether different view of the outlook for prices than the nation's central bank, as detailed by Gallup in "Inflation Worries Permeate U.S.," suggests that policymakers continuing easy-money stance is set to make things a whole lot worse than they already are.

PRINCETON, NJ -- Although the Federal Open Market Committee said "inflation is likely to be subdued for some time" after its meeting last Wednesday, 55% of Americans in an April 8-11 Gallup poll are "very concerned" inflation will climb, and another 29% are "somewhat concerned." This level of concern about inflation also seems to reflect consumer inflation expectations contradictory to the FOMC's assertion that "longer-term inflation expectations [are] stable."

A higher percentage of lower-income than of upper-income Americans are "very concerned" about inflation, likely resulting from lower-income families' tendency to spend a much larger proportion of their income on the basic necessities experiencing the most pronounced price increases -- food and energy. More Westerners than Easterners are very concerned, possibly reflecting the higher gas prices in that part of the nation. Concern is greater among conservatives than among liberals or moderates, perhaps because, compared with the other groups, conservatives are less likely to say they enjoy spending (vs. saving) and, therefore, they may be more price sensitive; and more Republicans and independents than Democrats are very concerned, given current political predispositions.

Few Escape Financial Concerns

With today's nearly double-digit unemployment rate, it is not surprising that among their other concerns, 68% of Americans are very concerned that unemployment will remain high. Largely consistent with fears of higher inflation, 45% are very concerned that interest rates will climb. Even after the sharp recovery on Wall Street over the past year, 35% are very concerned that the stock market will fall -- possibly reflecting, at least in part, the percentage of Americans who are significant investors in the stock market.

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Comments

[no stocks 4me]

Who cares anymore!, as long as "Uncle Ben" says theres "NO Inflation", there's NO Inflation, smirks

the banks, Boooya stock boys and the bond baby's are all for Ben's BS and hope he never raises the rates, no matter how high prices go for the "normal" person that has to buy food, pay for high priced gas, elec bills, and meds and hope to make a little interest on cd's to help cover it..

[ykw]

Real Prices vs. Stated Prices

stay ahead of the curve:

The marketmakers are systematically being herded back into the market, through a one-way valve, and they can make the numbers say anything they want, while non-marketmakers are abandoning the market, through a window that is rapidly closing, leaving those that remain increasingly subject to confiscation by increasingly sophisticated computer algorithms (passive investors). Be smarter than the computers.

Numbers in computers are just numbers in computers; they can be erased at will, by many parties. Get out of non-performing and into productive. Consider the difference between real prices and stated prices. If housing fell 75% across the board, you don’t really lose anything if you own the house and have a valid need for it, but the rentier economy is collapsing, so paying a substantial mortgage makes no sense (possession is 9/10 of the law).

As they seek increasing control to blow the bubble back up, their scope of control decreases, as more and more people abandon the ship. The only thing they cannot take from you is the brain in your head. Regardless of how the financial pyramid is dismantled, in what intermittent revulsions, practical skills in farming, electrical/electronics, and nursing will be required, along with practical, productive investment skills.

If you look, you will see that they prototyped all the internal population control methods currently being rolled out with the “dead-beat-dad” process. Consider how that works and protect yourself accordingly. As always, markets favor those that can absorb the most pain over the long term. Pain is relative. Set yourself up to be patient. If you consider pensions an empire sunk cost, with a value of 0, anything you salvage will be a plus.